Top Pick 2023: This Banking Gave Robust Performance In Q2FY23, Brokerage
Assigns Buy Call
Federal Bank, a midcap bank, as its top banking stock for 2023.
The brokerage recommends "Buy" the stock with a target price of Rs 160/share.
Considering the given target price, the stock has the potential to gain up to 17% in 12 months brokerage recommend if "Buy" the stock it the stock is purchase target price of Currentd Price at the Current Market Price.
Thes, has a Market.
The Current Market Price (CMP) of stock is Rs 137.65/share on NSE, 2.99% up as compared to its previous close.
Its 52-week high, which was recorded on 15 December 2022 is Rs 142.20/share and its 52-week low, which was recorded on 20 December 2021 is Rs 80.60/share, respectively.
It has a market capitalisation of Rs 28,954.81 crore.
Buoyant Credit Growth Prospects: FB's credit growth witnessed continued growth momentum and remained robust in Q2FY23 with advances growing at 19% YoY.
The bank is also keenly focused on neo-banking tie-ups to reach the country's under-banked population and expects these partnerships to contribute meaningfully to the overall business growth moving forward.
Outlook & Valuation
FB reported a stellar performance in Q2FY23 with the highlight has been the multi-year high RoA of 1.2%, which was led by healthy NIMs of 3.3% (multi-quarter high) and modest Opex growth with the C-I Ratio improving to sub-50%.
"We maintain our BUY recommendation and arrive at a TP of Rs 160/share, implying an upside of 20% from CMP," the brokerage has said.
The stock has been picked from the brokerage report of Axis Securities.
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By Shubham Kumar Goodreturns